U.S. Proposes New Fuel Economy Standards for 2021-’26 Vehicles

The U.S. government on Thursday made public its proposal to change fuel standards set in place during the Barrack Obama presidency.

The U.S. Department of Transportation’s National Highway Traffic Safety Administration (NHTSA) and the U.S. Environmental Protection Agency (EPA) released a notice of proposed rulemaking to “correct the national automobile fuel economy and greenhouse gas emissions standards to give the American people greater access to safer, more affordable vehicles that are cleaner for the environment.” The proposal is being called the Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule for Model Years 2021-2026 Passenger Cars and Light Trucks-or the SAFE Vehicles Rule for short.

The SAFE Vehicles Rule is the next generation of the Congressionally mandated Corporate Average Fuel Economy (CAFE) and Light-Duty Vehicle Greenhouse Gas Emissions Standards. This is the government’s first formal step in setting the 2021-’26 Model Year standards that must be achieved by each automaker for its car and light-duty truck fleet.

NHTSA and EPA are now seeking public comment on a wide range of regulatory options, including a preferred alternative that locks in model year 2020 standards through 2026.

“The agencies’ preferred alternative reflects a balance of safety, economics, technology, fuel conservation, and pollution reduction. It is anticipated to prevent thousands of on-road fatalities and injuries as compared to the standards set forth in the 2012 final rule,” according to a NHTSA news release.

“There are compelling reasons for a new rulemaking on fuel economy standards for 2021-2026,” said Secretary of Transportation Elaine L. Chao. “More realistic standards will promote a healthy economy by bringing newer, safer, cleaner and more fuel-efficient vehicles to U.S. roads and we look forward to receiving input from the public.”

“We are delivering on President Trump’s promise to the American public that his administration would address and fix the current fuel economy and greenhouse gas emissions standards,” said EPA Acting Administrator Andrew Wheeler. “Our proposal aims to strike the right regulatory balance based on the most recent information and create a 50-state solution that will enable more Americans to afford newer, safer vehicles that pollute less. More realistic standards can save lives while continuing to improve the environment. We value the public’s input as we engage in this process in an open, transparent manner.”

The current standards have been a factor in the rising cost of new automobiles to an average of $35,000 or more-out of reach for many American families, according to the NHTSA news release.

Proposal By The Numbers

NHTSA issued a fact sheet showcasing how its proposal will impact vehicle manufacturing, the general economy and consumers. According to the fact sheet the government’s SAFE proposal calls to:

  • Lower the industry average fuel economy requirement to 37 mpg, compared to the 46.7 mpg projected requirement under standards issued in 2012.
  • Reduce the percentage of hybrid vehicles needed to comply with fuel standards in model year 2030 from 56 percent to 3 percent
  • Increase daily fuel consumption 2-3 percent, which is equivalent to approximately 500,000 barrels of oil per day.

The SAFE proposal also estimates:

  • A $252.6 billion reduction in regulatory costs through model year 2029
  • A $2,340 reduction in overall average vehicle ownership costs for new vehicles
  • Over 12,000 fewer crash fatalities over the lifetimes of all vehicles built through model year 2029
  • Over $500 billion reduction in societal costs over the lifetimes of vehicles through model year 2029, including $77.1 billion attributable to fewer fatalities; $120.4 billion due to fewer injuries; and $51.9 billion saved from less congestion and noise

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